Palestinian leaders met Monday to plan a response to what they see as US President Donald Trump's attack on their long bid for statehood, after Mahmud Abbas denounced White House peace efforts as the "slap of the century".

The rare meeting of the Palestinian Central Council -- a high-ranking arm of the Palestine Liberation Organisation -- was called after Trump's controversial December 6 recognition of Jerusalem as Israel's capital.

Palestinians want the annexed eastern sector of the city as the capital of their future state and president Abbas has said Trump's stance means the US can no longer be the mediator in peace talks with Israel.

The US president has sought to bring Israel and the Palestinians back to the negotiating table, with talks stalled since 2014.

Speaking Sunday evening at the opening of the council, which brings together Palestinians from multiple political parties, Abbas told delegates: "We said 'no' to Trump, 'we will not accept your project.'"

"The deal of the century is the slap of the century and we will not accept it," the 82-year-old leader added, referring to Trump's pledge to reach the "ultimate deal".

He instead called for an internationally mediated peace process.

Israel is unlikely to accept any other mediator than the United States, accusing United Nations bodies of systematic bias against it.

The delegates began meeting Monday morning, with talks expected to end in the evening with a joint statement.

The last meeting of the PCC in 2015 called for the ending of security coordination with Israel, but its decisions were non-binding and it was never implemented.

'Israel ended Oslo'

The Palestinians' relations with the US leadership have deteriorated rapidly since Trump's election.

He came to power promising to lead the most pro-Israel administration in history, but also to pursue a peace deal.

His envoys, including senior advisor and son-in-law Jared Kushner, had been shuttling between the two sides in search of common ground.

But Trump also infuriated the Palestinians by refusing to commit to the idea of an independent Palestinian state and recently threatened to cut hundreds of millions of dollars of US aid.

The Jerusalem announcement prompted the Palestinians to freeze ties with the administration, and Abbas is expected to shun Vice President Mike Pence when he visits the region next week.

On Sunday night, Abbas attacked the US ambassadors to Israel and the United Nations, David Friedman and Nikki Haley, calling them a "disgrace".

Both Trump appointees have been strong supporters of Israel, with Friedman having backed Jewish settlements in the occupied West Bank.

An indignant Abbas also said that Trump had accused them of refusing peace negotiations.

"May God demolish your house. When did we refuse?" he said, using a common Arabic curse.

Israeli media focused heavily on the phrase on Monday, while Defence Minister Avigdor Lieberman said the statement showed Abbas was "losing his wits and giving up negotiations."

In a speech during a state visit to India, Israeli Prime Minister Benjamin Netanyahu did not mention Abbas's comments.

Abbas said all options were on the table for responding to Trump's Jerusalem declaration but did not specifically mention suspending recognition of Israel or ending security coordination with the Jewish state -- both policies mooted in the days before the council.

He did, however, say the Oslo accords that led to the creation of his Palestinian Authority and envisioned a final resolution to the conflict were in effect finished.

"I am saying that Oslo, there is no Oslo. Israel ended Oslo," he said, referring to persistent Israeli settlement building and other issues seen as eroding the possibility of a two-state solution to the conflict.

Hamas, the Islamist party that rules Gaza, is not taking part in the council -- arguing it should have been held abroad to avoid Israeli pressure.

In a statement Monday the party said Abbas's speech "did not meet the ambitions of our people."

"The central council must end Oslo and stop security coordination and withdraw the recognition (of Israel)."